Delivery company Hermes UK is to benefit from a significant investment by Advent International, a global private equity firm. This follows an announcement from parent company Otto Group that it has formed a partnership with Advent for its Hermes Group businesses in the UK and Germany.
Under the terms of the deal, Advent will partner with the current management team to acquire a 75% stake in Hermes UK. Otto Group will continue to own 25% of the company. The transaction will facilitate further investment by Hermes in technology and infrastructure and support the future growth of the business in the rapidly growing parcel delivery sector. The management of Hermes UK will continue to lead the business as an independent company.
This follows a recent announcement by Hermes UK that it is looking for more than 10,500 potential workers to join its business, to meet the huge demand created by people shopping at home during lockdown, and the continuing growth in the sector. Hermes UK predicts that parcel volumes will reach record levels during the Black Friday and Christmas period.
Martijn de Lange, CEO at Hermes UK, said, “This is fantastic news for Hermes UK as we continue our upwards trajectory in the fast-growing and capital-hungry home delivery sector. The investment will enable us to remain independent and be agile and responsive to future market requirements. It will help to expedite the development of our capacity and technology, supporting the introduction of new innovative products and services that will greatly benefit our retail clients and their customers.”
Advent has experience of partnering with management teams to develop and grow businesses. Current investments in the e-commerce and logistics sector include InPost, a company providing secure self-service lockers for the collection, return and delivery of parcels, and which has seen significant growth since Advent’s involvement.
In addition to the 75% shareholding in Hermes UK, Advent will also acquire a 25% stake in Hermes Germany, which includes other Hermes Germany Group companies such as BorderGuru and a share in the ParcelLock joint venture.
The transaction with Otto Group is subject to approval by the boards and relevant antitrust authorities.